£2,000,000 MORE

Auckland Star, Volume LXX, Issue 179, 1 August 1939, Page 8

£2,000,000 MORE

DIRECT TAXES. BUDGET FORECAST. LEVY ON INCOMES. ALL TO BE AFFECTED. HIGHER DEATH DUTIE3. ir.y TrU'tfrnpli.— I'lirllnmontnry Reporter.) \\ KI.UNi; roN, ttii.- il.iy. Taxpayer* ntv likely I" he f.iccd with * ili'tuuiiil Inr ii|i|.iii\inuitcly ti.lMMl.dOn in ndilii ioinil dirt'i't l.ixation in tinIliului'l, which in In In> prexi'titnl in tlio [liiii«i< uf Mepri'ventnti , )!") to iiijilit liy I In- I'riim- MinUt.T. the lit. Hon. \l. .1. Sii\ii'ji'. in lii-> riipni'ity us nrtins-Minii*li-i' of Finnure, This is pxpectfd In Ih> nii't, by ini'i'i-ii«i'd inroino tax iiikl den I Ii ilut ion. All HHstpiixiilili' iiifonips will hv ntTei-tcil, hut tlu> iinpiirt in likely tn lie m<wt H'\eie nil ineonieH on tho lusher k , \i , U. Kiillinjt Cu»tomn revenue, iih the result of t Ik> import selection policy, together with II stee|i inereiise in defence e\|n>iulitlire, liHvh no doubt roml.'med tu make Alii* i'oiili»i< iiiev it able. KninoiiiN that linvi- jzaiiiod ground leeently iiliont, an in<Tea"o ill tile sot'iiil »eciiiity tax. iiml tho poncihility of a ipoeial direct tax for ileieneo are not likely to lie wiil>v.latitiato<l in the Budget. In Hpili' of tlie .lilliciiltics uili'ild of till! «;o\ eminent during the c-virrent year the Minister of l'"iiumee in working on the a.itieiptit ion of n balaneed liiid^ct.

Major public works now in the course <nf Construction will be carried on, with the, object of completing them, and the development of the Dominion's defences in bound to figure, largely in thLs vote. Increased Defence Expenditure. The nx puns ion Ist policy of the (lovernnient in defence i» likely to he acoelorated. Dpfenco now constitutes a steadily Increasing proportion of annual expenditure and it is expected that the proposal*) for the present year will indicate snbstant ial increases in respect of the army, navy and the air force. lit lD.'iS the total outlay was £1,000,000. The following year tnw this amount jump to £2,2a0.(HM), and this year it \i* prolmble. that mi ndditional £1,000,000 will bu allocated to this vote.

Import Restrictions. The imposition of import restrictions must result in a seriuus loss in Customs ruveiiue, as luxury lines, which carry high duties and which, us a class, are 11 nic Hut lucrative source of Customs revenue, are the lust to have be.'tl affected. The importation of these goods in likely to be reduced to a minimum. while on the other hand imports of raw materials which are required for secondary Industries cannot, except in iv minor degree, oll'sel the decline on luxii y line-, us raw materials are in most instances subject to what really amounts h> 11 nominal duty. The (rovernnient'n policy of fostering secondary industries will naturally receive some mention i-i the Huclget and while thn Minister of Industries and Commerce has repeatedly ptnphaelsed the Government')* desire "o facilitate local and ovprceas interests i.i the establishment and development <>f industry it is not anticipated that the Rudgi't will revoal any policy of granting Htmneial assistance in the way of subsidies.

Tho negotiations carried out by Mr. NTash In regard to the tl«,000,000 conVtfi'ulnn loiiu will no <li)iil)t be referred to in Biiiiiu detnll. 'I'lio redemption provision* are HoVi>re. but an they do not commence to operate until next year tli • (iovermnent's plans tu meet these obligation* will probably be deferred until a later period.

Public Works. It i« expected that the Hudget will tnaku provision for a continuation of the public work* programme at a normal rate. Last year the amount actually upent wan over £11,000,000, of which JCIMM2.OOO came from loan moneys. During tho current year thin total is not likely to be again reached, not for any reuson of retrenchment but owing to the operation of the policy of encouraging the transfer of miiUlilo workers from construction jobs to the growing opportunities in secondary industry.

Ffijrliwaya construction will continue without reduction, though it can be taken for jjranfed that motorist** , contributions through the petrol tax, part of which irocn to assist, the general rovouuo, will not have to be increased. Tho recently raised internal loan of .C4..")00,000 provides a substantial portion of the public works funds for the year. Tho proportion of public works funds now being diverted to defence in Increased, and it includes provision for larger aerodrome* mid extensions of existing facilities.

No More for Social Security. Wiige- «'iiniern will cllhcovit with relief that they ara not to be called on to pny any additional unci ill security tux. The 1/ in tin , pound remains unchanged. It wiih anticipated, when the legislation wiis before Parliament, that when the full obligations of the new bcnetltn— honpitul and maternity treatment, tho general practitioner service and t tin provision of medicines mid' n pplin neea—hud to be met there would lie a margin of at least £1.750,1)110, whieh munt eonio from the Consolidated Fund. However, flip delay in bringing In the full scheme (although the social xeeurily tflx commenced to bring in its full revenue from March 31) enables the fund to operate without the. necessity I'm- culling upon the general taxpayer. Tim* the principal need for higher revenue i< tlnit, of defence.

Tilt) estimated cost of the phases of «<yii,l HC'ourity not yet operating are ■U .210.000 for the genernl practitioner «««'vi«.. and £.V|II,O(M) for medicine* and ■ppilancea.

fiitei. that m far th« . P, "", t,OT, lnd, -

Dairy Account Deficit. "What i, in Ih> <|riih> in regard to the rtfliiil mi I liv Dairy Industry Account ft.r the ifHMiii just (!<.-i-(l r The Minis. ti'ii.il c-i iin.it I , places it nt approximately L_'.iniii.ii(iH. In the Financial StiUciiii'iil I lif operations iif this fund lire likely In tii> ri'\ I.'Wcml in detail. 1 illt it is ehiiihtfill if reference* t<i the liandliip_' iif tin , ili'lii'il will In- -pci-iflf. Ilin in'.' i-1 ♦-; * i iml tin , previous doliit balance of (iM'i- l>\ ;i transfer from tin , LNiii-nliiliiliMl Knurl, the new dfl.it will, it. i-. if-iiiniMl. remain until iin proved rmiilii ion- in tin- dairy produce miirki't ii\i'i -i',i- iMiiiMi' tin , account to In- ~f |iiart>il witlmiit fiii'tliiT recourse, t" tin , taxpayer. A rexiew of lum-ing "ill ii vain appear in l In- Umbel. and there i- likely to he m> re-ti'ii-t iiiu of this clans uf activity.